Another solar company, another bankruptcy, another loan guarantee leaving taxpayers holding the bag
Abound Solar, Inc. was awarded a $400 million loan guarantee courtesy of you and me and has now suspended operations. They plan to declare bankruptcy.
They borrowed $70 million against that guarantee, but taxpayers will still be out $40 million.
It turns out, its solar panels were too expensive to compete. Gee - who would have thought it?
Abound borrowed about $70 million against the guarantee, the Loveland, Colorado-based company said today in a statement. It plans to file for bankruptcy protection in Wilmington, Delaware, next week.
The failure will follow that of Solyndra LLC, which shut down in August after receiving a $535 million loan guarantee from the same U.S. Energy Department program. Abound stopped production in February to focus on reducing costs after a global oversupply and increasing competition from China drove down the price of solar panels by half last year.
"Aggressive pricing actions from Chinese solar-panel companies have made it very difficult for an early stage startup company like Abound to scale in current market conditions," the company said in the statement.
U.S. taxpayers may lose $40 million to $60 million on the loan after Abound's assets are sold and the bankruptcy proceeding closes, Damien LaVera, an Energy Department spokesman, said in a statement today.
"When the floor fell out on the price of solar panels, Abound's product was no longer cost competitive," LaVera said.
I really wish these companies - and the government - would stop blaming China for their failures. China may be subsidizing their solar companies but in case you didn't notice, so are we. The fact that we gave this loan guarantee to a sure fire loser of a company keeps proving the point about this idiotic energy department program; trying to pick winners in the alternative energy business is too risky for taxpayers to foot the bill if the bureaucrats are wrong.